When to Hire Account Managers Before Sales Development
There are (at least) two different sales POD designs depending on the percentage of your business that comes from existing customers. A standard sales POD used for medium- to large-sized SaaS deals often uses a sales development representative to create a pipeline of new leads, so that account executives can focus on closing new business.
However, there is another model, that replaces the SDR with an Account Executive. This “inverted POD” works well where it is relatively easy to get the initial deal, but where much of the revenue comes from selling additional deals into existing customers. After the first sale, an account management rep is dedicated to creating leads from existing customers. In both cases, customer success works to realize the client’s goals.
A rule of thumb we use is that you don’t want to spend more money on your sales POD in salary than 50% of the quota they can bring in so having an SDR (sales development rep), AE (account executive), CSM (customer success manager), and an AM (account manager) may be too expensive in some cases and then you may have to choose between SDR or AM.